tv U.S. Farm Report ABC November 21, 2015 5:00am-6:00am CST
records.> our farm journal report shows you why when budgets are tight, the smallest mistakes can really add up. keeping your eye on the future... we want it to continue to move forward. whether that's through my nephew my daughters or my neice or son i ilaws> our leave a legacy shows us why one delaware family is finding new ways to ignite interest in the family's poultry farm. in john's rld...
november rural mainstreet index is out...from ernie goss at creighton university. he says the index fell below growth neutral for r third straight month. the farmland and ranchland index rose a bit in november but remains in negative territory. the same is true for farm machinery...while hiring in rural america holds... goss says mainstreet businesses continue to hire workers but at a much slower pace, but he's more bullish heading into next year.
begemann stating during an inveveor meeting this weekekhat they've been studying every possibility for consolidation in both the seed and chemical sectors. and syngenta remains a possibility. syngenta's previous c-e-o mike mack announced he would be stepping down in august, after the company rejected three takeover offers from monsanto. snow and cold weather isn't going to help feed yards with efficiency. that part of the industry still struggling under the weight of a falling cattle market. sterling marketing says feeders were experiencing an average per head loss of 518 dollars. the extreme losses already impacting feeder cattle prices in the cash market. october retail egg prices dropping 5 percent to 2-80 a dozen...that's down from the previous month's all time high of 2-96 in september. the number of laying hens now rising for the 3 straight months. the poultry industry lost 48 million birds to avian influenza in 2015...38 million of those were egg layers. a glut of global crude is helping to push fuel
prices lower. diesel prices are now 32 percent lower than theyey were a year ago...averaging 2-48 a gallon. analysts say now may be a good time to lock in these lower prices. lower crude oil is going to improve margins for refiners and that's going to encourage them to build these supplies which have drawn down just slightly and we do expect prices around 2 dollars per gallon regionally. as far as looking ahead to next spring we do recmend booking at leasasa portion to guard against any potential upside surprises in the crude oil market or any shortages on the distillate side. book a portion of that for spring ahead of time once we hit that low in december.> those are the headlines...meteorologist mimi hoffman joins us nonowith weather, mike, we've gone from beautiful 60 degree temperatures to now blizzards and heavy snows. is this cooler pattern expected to stay through thanksgiving? actually no the midwest and east should warm up for awhile this week, the west will get colder though. so there'll be some flip flopping there once again. drought monitor contntues to show just
only a few pockets east of the continental divide of moderate drought the worst continues to be california nevada and still ry very dry in most areas of oregon and washington even though thhere has been some improvememt up that way. all right lets go day by day this week you can see as we start the week on monday lots of high pressure dominating the weather map and thats always good news. we do have cold front moving through south florida so still some lininring showers and spotty thunderstorms down that way. weak system diving into the great lakes with a little bit of rain and snow there should not be a real big issue but that will continue to move eastward so the milder temperatures coming into the western plaines will continue to shift eastward. now this is just the beginning of the next storm system coming in. you can see by wednesday that's producing some big time snows in the western rockies. rain and snow farther east along this cold front and then some spotty showers in the plaines as the gulf moisture starts to get involved. this storm really starts to crank up by later in the week this is black friday of course. you can see rainy conditionsnsrom northern texas all the way into the great lakes, and snow on the back side of it. probably some decent
farmers right now? >> well, i feel that we've got two different markets going out here. one of them is the eastern corn belt. the basis is going to beonderful whenever. they need corn they're going to be pulling for it and likewise probably beans too. the western corn belt's going to be the opposite. i think that producers probably should be looking at moving grn and then rowning it back on the board, and i'm not seeing that because i'm a broker, i'm saying it because i think the rallies this next year are going to be futures led and not cash led. >> okay. duane, do you agree th that? i mean these areaeathat are seeing decent basis, is it something they should lock in? i mean, how long can it last? >> i can't agree more with sue there with that. no, i think farmers need to be moving that grain right now. like she said, not just because we're brokers,s,ut if you look at it i think if we have a futures rally, which i think we will, we get a weather scare in south america, let's just say for example corn rallies 30 cents. i think your basis is nice and tight now. basis will
in youougrain market, so they should be moving that basis right now. when you look at where the gulf is at now compared to last year, their basis is actually lower. export demand isn't the best right now, but basis in your local area is usually pretty good in most locations, so they should be moving that grain. >> you mentioned weather in south erica. i mean, sue, when we look at prices right now, not the best when you're a farmer. so are we only looking at two bullish factors in 2016? only weather in south america or weather scare here that could bump up prices? or is there something else that could lead a rally? >> well, i think first off the dodoar this next year, i ithink, is going to peak out and give us a correction and that will help stimulate some demand. cheap prices is the cure for cheap prices. demand's going to escalate a little e t. i think that w wn you look at southh america and u.s. weather there is going to be some issues. right now the western side of argentina is a little on the dry
southern brazil caught too much rain, but they may be drying off a little bit. i think that as we go down the road there will be some rallies here in this grain market. it's going to be a little different than this last year. this last year was an ekg blip. straight up, straight down. this next year's going to be more trendy a little bit once it gets going, but it's going to take a l ltle time. we're stilil in this flat, sideways range on the markets, but i think that we're, you know, looking at history. we're not that far off from looking at some lows in corn. i think thatathen we look at i think the dollar'r'part of this, and i think the weather's going to be the other key because corn planting around the world is going to take a backseat to other commodities, and i think all you need is a nudge for this market to go higher, and once that starts on continuation charts like on july corn, you're in you're out. dec
weekly charts that have not been filled, and they're humungous. they start from all the way around 548 and go to84. 632 on the dec to 709. . ose are big gaps, and when the market gets that nudge those will act like magnets. >> so heading into 2016, duane, what mmodity are you the most bullish on? what do you think as the most potential? >> i iould definitely say y rn because of a lot of the reasons sue mentioned. corn acres will be up in t u.s., but i think they have to be up actually. we just raised a huge c cp, and our endingngtock is actually abobo the same as where we were last year at this time. so i think we have to gain acres next year, and if you look at the rest of the world situation, ukraine will be down on acres. they have some weather issues. south america, they're planting soybeansnsight now, but if the soybean planting gets delayed much more that means less second crop corn. less second crop down there means less corn in the world and we could have a higher price. corn is definitely the one i'm excited about planting on our farm next year. >> okay,and, sue, you actually have an
why don't you tell us about that. >> well, in going back i have data that goes all the way back to 1908 on corn, and in years that end in a six every one of them have a rally in a crop year of a year ending in a six, but what was interesting was is that the year ending in the e ve moving into the year of the si what it should be doing. in fact, corn fits the pattern very well, even as opposed to soybeans, and corn tends t tbe trending lower through november and into december. eight out of the ten years it did that. there was one year that we moved lower into january of the year ending in a six, and another year we moved into april for a final low, but the further later that you did that the longer that rally lasted. it was not uncommon, june was never a h hh month in those years. it was july, august or september, and
half of the year. so that would be a weather think. so i think there's hope out here, and once we get it going, whatever that reason is, and i believe there will be that reason, this market's going to go higher. there's one more thing that when you look at corn and we took all the years from 1968 and we took the major highs to the ultimate lows, which sometimes took more than a year or two to do that, the lowest percentage of that low of the high was 36.5% or something like that in 2008, and last year's 318 and a quarter low was 37.2%. so i think that was our low. this is an inside range year. we'll see if we cle it higher. >> okay. a little bit of a bullish h lk, a little bit of f change on this show this weekend. thanks so much. when we come back we want to get into cattle markets so don't go anywhere. join us this year as we talk to growers about this year's growing season and the decisiononthey're making on their journey to harvest,
they've been tough to watch recently, but between now and the e d of the year do you think we could seeee storm term bounce? >> oh, i think you can, and typically you do. seasonally you have a rally this time of year, usually led because of holiday purchasing by retailers and that, and you should see i saw this afternoon actually packer interest was better than i thought this week. cascattle prices look like they're going to be 195 in nebraska, which is on the low end of last week's trade, but better than some expected too. the demand has been high. they've been callingga lot of guys thatat've heard
cattle. when will they be ready?\pso that^s good. no, we could have a rally in the e ort term. >> but i i2016 what do you think prices realistically? >> well see, that's a different story. longer term in cattle if you look at all the bullish commodities from say '08 on when we had this really big pop, big bubble, cattle are the one price that haven't gone b bk to where they were before, and i'm worried we lost a lot of retail share when mcdonald's went to, for example, serving breakfast all day. they didn't do that to serve more hamburger. they're serving less meat. we lost our retail sharer in 2014 when prices went high. i'm afraid fat cattle will have to trend lower in 2016, unless the u.s. dollar can drop sharply and we can get exports going again. until that happens i'm going g be bearish on the cattle market. >> 120,0,15, 110, i mean, can you give us an idea? >> yeah, look for june1stto get down to probably 115. that contract will, i'm pretty confident.t.'m not sure if the rest will or not. >15, it's tough to hear, but, sue, if we do get down to that level let's
will. the one thing, i think too in the cattle market that we need to keep an eye on, it's kind o olike a doubledged sword. one is, is the weather that if we do turn hot and dry next summer for the whole midwest, that could be a little detrimental to the cow but on theheame token if we end the el nino and we start think you watch australia. if they start catching consistent rains timely, they^re in the same boat we were a couple years ago. they're g gng to start holding back cows and heifers and breeding, and that should slow up the amount availability of cow hamburger, whatever. so i think that will be a good thing. ononthing we're dealing g th right now is, is that both new zealand and australia have met their export quotas, a so the dollar really has to be super strong to entice them to pay that 21% and 26% tax or they're
u.s. feeder cattle, canada's down-- for october was down 72% while mexico was up 8%. so all of a sudden you're taking a big drop there. that should show placements dropping off a little bit. our weights, i think, are going to peak because the weather's going to turn colder. >> okay. along with these lower cattle prices we've also seen the lower hog prices. duane, have we gone too far t tthe lower end, do you think? >> yeah, i think we have. i think honestly nearby hogs on the futures contract could have stopped at 60. i think that would have been just fine for demand, t with the cattle market being as volatiles a it has been lately-- down limit, up limit daily-- i think we push down into those mi50s. but i think the cash market's bottoming out here in the hog market, and, again, too becausetpof seasonal buying. think hogs can rally from here, but we are looking at probably a production cord this week. slauauter will probably be a production record. like i said going to be altime highs there. so we've got a lot of meat to move, but the cash market stays steady this week.
. >> well, i think the one thing that i look at besides corn is the hog market. i think china's going to be a big buyer. they were our second largest importer this past week on pork and japan number one, but china has dropped the ban on imports of pork from the u.s. from, i think, 16 plants now. they wouldn't be doing that if they weren't intending on opening up their doors a little bit for more pork. i think that popo is cheap, so i i ok at the hog market as one area where we're going to see the market have a
biggest thing is these markets have just gotten too negative lately, especially on the grain side of things. it's all we've talked about is the negative side of things. manage money is now short this market, and we're looking at south american weather. right n n i feel like we are just pegging that crop. it's perfect. it's already in the bin, and they're just still planting it. so i guess my point i'd like to drive home is the fact that if we get a rally in the market or something it could be actually quitviolent because managed money is shortrt and they could go long. >> good thought. all right. john phipps joins us when we come back. receive a free trial of the daily market letter and gain knowledge about current market conditions from the professionals at bower trading. view the markets like never before. go to bowertrading.com.
trade pacts are always oversold - both the benefits and the costs. the tpp, like nafta before, probably won't move the needle much or quickly for any industry, including ag. . e big reason is the timelines for trade barrier removal are really long - almost generational. still, they are worthy goals. what was curious to me was the remamaable tunnel vision o o commodity groups. it's like they did a search of the massive document and then only read the paragraphs that contain corn, or beef, or whatever. to be fair, i didn't wade through the whole thing either. but t rmers should at leaea check to see what other important provisions are in the package. many of these don't have anything to do with agriculture, but a lot to do with being part of our economy. for example, the section of
will be slower arriving to help contain healthcare costs. if you don't understand why this is a big deal for us you need to have breakfast with some older farmers sometime and bring up prescription prices.ong after a small bump in beef sales h dissipated, twenty-dollar-a-day medication bills will still be arriving. the biggest reason i hope it passes may be the hardest to measure. increased trade is a proven deterrent to global belligerance. commercial ties decrease the odds of conflict while they make the cultures involved more at ease with each other. i can put u with a lot of economic friction in order to adadnce internationanacooperation. thanks, john. still to come, some farmers will do everything it takes to avoid paying taxes. but one c-p-a says not paying enough could be a farmers' biggest accounting mistake. that's our farm journal report after the break. the chevy silverado is the official news gathering vehicle for farm
leave a legacy, a delaware poultry operation that's not forcing the next generatioto come back, instead laying the foununtion for a passion to grow. and in john's world, he's back with part 2 of a dollar's worth. now for the headlines, .salmon is now the first genetically engineered animal cleared for human consumption in the us. the announcement coming this week from the fda. the atlantic salmon reaches market size more quickly than non-ge farm raised salmon. fda says they've analyzed the data and sasathe fish is safe to o t. many argue raising the fish at all--brings risks of it being released into the wild. fda disagrees adding that the fish are sterere and can't reproduce. it's stipulating the fish can only be raised in land-based, contained hatchery tanks at two specific facilities-- one in canada and the other panama. and the decision does not allow the fish to be bred or raised in the
u.s. the agency will accept public comment for 60 days starting november 23rd. a new report claims uncessary use of antiobiotiti in animals is becoming a health concererfor kids. the american academy of pediatrics, or a-a-p, claims antimicrobial drug resistance is a growing health crisis. and the common farming praraice of using antiobiotics in animals is one cause. a-a-p says when producers use antibiotics as a growth promotant, or to increase feed efficiency, it often leaves the drug ineffective when treating infections in people, espcially young patients. in response, the national pork board said the industry is already phasing out the use of antiobiotics for growth promotion, and that while they understand people are already confused about the role of antiobitoics in meat production, this report only adds to that confusion. taco bell joined the list of fast-food companies moving to cagegeree eggs this week. but their timeline is more aggressive than most. the chain promises to make the switch by the end of 2016. most other companies are giving a 5-year to
thanan thousand restraunts and sells close to 1 1 million eggs each year. this was the scene along i-70 as heavy snows and strong winds stranded vehicles d shut down highways in eastern colorado this week. the national weaeaer service said wind gusts of up to 60 mph created blizzard like conditions...in cololodo, kansas and partrtof nebraska. the fall storm a concern for some livestock owers after mild temperatures the last few weeks. meteorologist mike hoffman joins
us now w wh a look at our ng-range forecast. mike that blizzard earlier in the week, i'm guessing is just the beginning of winter weathe oh yeah, it'shat time of year but the next big system probably coming in out west this week. here's the jet stream as we head through this week, you can see we started off very cold in the east. that troph though kind of moves away. so we start to warm up a little bit as we head toward thanksgiving, big troph big system out west, and then that cold air starts to come east by next weekend once again. so, things&are at least moving from west to east in most situations. leles check the 30 day outlook as far as temperatures, we're going below normal from georgia, alabama all the way up to southern south dakota, down to texas and back to central and southern california above normal for the far northern and eastern great lakes and much of the northeast. 30 day outlook for precip, expected to be above normal for much of the southern trow thirds of the country, especially the midantatic down into the southeast back into the central and sosohern plains. some bebew normal areas probably up along
the canadian border, especially the northwest and far northern rockies. so far during our business drivers series, we've explored forward contracting, cash rents and growth for 2016. but in order to manage most of that, you need good accounting. in this week's farm journal report, we learn how advancingyour accounting practices can propel you into the future, especially in years like 2015.
down and scrutinize their balance sheet. put it together, and work closely with their lendor, but also evaluate that and the trends t ty're seeing on their own farm."> that's why neiffer suggests distancing yourself from excel spreadsheets. it may be easy to set up, but it also creates more mistakes.
actually produces better than that type of soil. and w wh the technology available today, farmers are going to be able to dig all the way down to the soil level and know how much they make based on each of their soil typepe"> technology on the horizon that neiffer says could be here sooner than you think. the latest issue of top producer magazine includes a similar ararcle, titled "advance your management accounting" that hits mailboxes this week. you can also read it online-- topporcer hyphen online dot com. when we come back, john phipip.
of the problems with those metrics. this week let's look at why this matters to farmers.the relative value of the dollar impacts farmers whenever we buy or sell stuff with other countries. here is how it works.say your customer is chinese and has 1000 yuan to spend on u-s products .this is a typical currency chart showing how many chinese yuan (cny) it takes to buy one dollar (usd). if the exchange rate is 6.05 as in 2014 you could get 165 dollars. but right now you can only get 157 dollars. the yuan is weakening, or from our perspecte the dollar is strengthening. by the way i think charts like this which track our currency versus another are often more useful than the basket-type indexes . commodity producers should follow the exchange rates of
are some factors that determine the relative value of currencies. the biggest factor is simple supply and demand: do people want to hold their weth in one currency or another? the dollar continues to be considered the safest haven n any unrest around the globe will increase demand, and hence the value of dollars. if u-s interest rates are higher than other developed countries, that too will strengthen the dollar. despite the rhetoror, central banks have less power to fixix exchange rates than they used to, as money flows and black markets wi simply do an end-around if traders think the values are out of whack.all of us are affected by the strength of our currency. a strong dollar is good for american tourists
going abroad or seniors wintering in mexico. things like computers, cars, oil and copper are cheaper to buy, which holds inflation down. but a strong currency probably diminishes our economic growth slightly. it also encourages outsourcing, which can hurt jobs. and it clobbe american exporters.almost all sectors of agriculture depend on exports for a big part of their markets. here are our top 10 export-dependent commodities. note four products export more than 50% of production. so despite the posirive aspects of a strong dollar, i would say on balance it burdens u-s ag.the bottom line, however, is as much we complain about cditions
here, the rest of the world sees the u-s as a stronger and safer economy in which to invest. so the dollar remains valuable. what needs to happen is more growth and stability around the world, so other currencies can compete with the dollar. thanks, john. and remember to email your questions or comments to jn, or s sd us a note on facebebk or twitter. whehewe come back, an east coast family is trying to spark a passion for poultry within the next generation at a young age. that's leave a
delaware family that changed its business model in order to keep the next generation on the farm. grain side--thompson farms.... poultry --locust-lane-hartley leavinina legacy...the passing of an older generation...on to a new one... that practice is alive and well at the thompson family farm in hartley delaware. we're trying to work toward's being successful to have a legacy to pass on to the kids.// today that operation includes, tractor and restoration n rk, raising poultry for perdue farms, growing replacement dairy heifers, and keeping up with farm ground th grows soybeans, corn and soft red winter wheat. robert thompson took this farm over from his parents...but it was his grandparents that started the operation in 1911. he was like many farmers in the area at the time mosw of them had small orchards and some strawberries and grew a lot of
in the business-- the family started a dairy. he milked cowow his lifetime and i milked cows...barbara and i got married in 1969 and milked cows until 2003 here. 24:49 the operation has always been diversified..at one time the family tended a thousand-laying hens, tomatoes and d eat. it's a traditioio that continues. and as robert turned the corner on a new century, he could see changes were needed. the dairy needed a lot of expanding and updating.g.it required a lot of money that none of us wanted to do that... it was at that time that two of his son's arron and jonathan -- expressed interest in teaming up. even when we were in elementary school we started helping him before we went to school and after. so we were big
our partnership and we started working to where working together instead of me just working for dad as a son or employee, i was a partner at that time. that's when the team began to transition from dairy to poultry, first flock went in january 2006 and we started poultry as a way to increase income for all of the families so far...that plan is working. and even through the day to day....the family has their eye on the future. we want it to continue to move forward. whether that's through my nephew my daughters or my neice or son in laws what ever that is. we want to see that continue to move and feel the like things that you builtill be there to help them move forward in life. haven't set any goaoa that we want to be large farmers or a certain amount of acres to till. we're trying to remain to be profitable here and be able to
happen without t tt same passion frfr the next generationoni'm starting to take my daughter in on sunday's in the chicken houses when they're small so e'll start in and i think she'll have interest in seeing everything move forwrwd. we're not forcing anything on anyone but if the possibility is there its good to be there. for leave a legacy, i'm clinton griffiths reporting. thanks, clinton. youcan learn more about farm journal's legacy project by visiting leave a legacy dot com. when we come back, al pell has this week's tractor.
this is a 1923 1220 cross motor case. its the smallest cross motor that they built. i actually found this down in vancouver washington. yeah, i found it in a newsletter. from another club and the fella that had it i called him and talked to him about it and i figured it would be long gone. i asked him what he wanted for it
and he said 65. and so i said is that 65 dollars 6,500 dollars, 65 thousand, what is it. he said oh, 650 dollars. and so i asked him a few more questions about it, especially the manifold, if he knew if the manifd was there ananhe said he thought i i was but so i saiaiok ill send you a down payment. i went down and actually picked it up. on dember the 20th and it is a 1220, so i was destined to have thth tractor. but it wasasn really really rough shape when we got it. the radiator had been shot gunned. there were bullet holes through the fuel tanks. the fuel tanks were shot, but we
spent a lot of time on it, rebuilding it. we got it in 97, by 2000 we had completed it and my passion is the early tractors. doesn't matter what it is if it appeals to me if it's an early enough tractor im interested in it.this week, we would like to pay tribute to the asstad lutheran church of fergus falls, minnesota. the congregation is celebrating 125 years this year. our thanks to cindy fronning for senenng that in. please stay with us. cropwatch is next.
tt tells u uit was a blessed harvest this year. he tells us john may have found the last row in his corn field, but he found the last three rows of onions, harvesting the crop with one of his sons. he said even though they've experied very dry weather in the western half of oregon, the quality of the onions is very good this year. teh dryness just stuned the size of the onions. but greg
with a brilliant sunset in the backdrop of his fields. our friends in northern georgia tell us they've received way too much rain. clint sent us this picture. the moisture was just too much for the soybeans, with the pods turning black and rotting. and do you remember this picture from back in july? mitchell larson told us he expected the field to break last year's record crop. well, fast forwarara few months, and hehe's the crop just before harvest. mitchell says, as expected, it was a record year for corn, with the poorest field averaging 194 bushels per acre and the best at 252. for all of us at u-s farm report, i'm tyne morgan. thank you for watching-s farm report, i'm tyne morgan. thank you for watching u-s farm report. be sure to join us right here again next week, as we wo to build on our tradition. have a great weekend, everyone.